After climbing to record highs last week, Wall Street opened higher Monday as corporate earnings season kicks off.

In early trade, the Dow Jones Industrial Average advanced 0.5%, the S&P 500 rose 0.4% and the Nasdaq Composite added 0.4%. On Friday, the S&P 500 rallied 1.2% to a record of 4,840, while the Dow also hit new heights, surging nearly 400 points, or 1.1%, to reach its second record high since December.

Wall Street's recent run-up has been driven in part by expectations that the Federal Reserve will cut interest rates in the first half of the year amid a steady decline in inflation. The Fed has hinted that rate cuts are coming, though some officials have hinted they may begin later than the market is hoping for.

The technology sector, led by booming demand for services that tap artificial intelligence, is also driving early-year gains, along with signs of robust corporate profits. Analysts at UBS say AI will continue to be a key driver of global tech stocks in 2024 and over the next several years.

"We forecast global AI revenues to grow 15x between 2022–27 from $28 billion to $420 billion," Solita Marcelli, chief investment officer Americas at UBS Global Wealth Management, said in a note. "This growth is expected to be driven by particularly strong demand for AI computing and GPU chips in the next 12–18 months due to strong AI training demand and a rising share of inference (running AI applications after models have been trained)."

Earnings season gets under way after the bell when United Airlines posts quarterly and annual financial results.

In energy trading, benchmark U.S. crude added 18 cents to $73.43 a barrel. Brent crude, the international standard, gained 14 cents to $78.70 a barrel. The U.S. dollar fell to 147.87 Japanese yen from 148.14 yen. The euro cost $1.0886, down from $1.0897.

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